22 Jan Why Keeping Track of Your Finances Secures Your Savings
Hi, Acadeo friends! Do you have savings? Are your savings robust, or are you still working on growing your money savings?
We’ve always been taught that saving up is something we should make a habit out of. There are benefits to saving, of course: they’re useful for emergency funds, and if there are things we want to invest in, savings can contribute greatly towards it.
KNOW YOUR LIMITS
When it comes to saving money, the first and most crucial step is knowing how much you have to work with.
If you know how much you have at any given time, then you can better manage your budget. This is helpful when you’re trying to save up, because this way you can identify how much you can spend and how much you shouldn’t. For example, if you’re trying to save at least 10% of your daily allowance, knowing the exact amount you have on hand means you can set aside the amount for savings right away without worry.
On a larger scale, you can better sort your finances if you know exactly how much you have available on a weekly or monthly basis. Knowing your financial limits gives you an idea of how much you can put into your savings accounts, as well.
IDENTIFY YOUR EXPENSES
Do you know where your money goes?
If you don’t know what you spend your money on, then you’ll have a hard time saving up. Accounting is not just for businesses and large companies – it’s an important part of managing your finances, and being able to account for your expenses is an adulting skill that many people surprisingly don’t have mastered.
One easy way of identifying your expenses is to keep a notebook and list your obligations at the start of the month so you can see clearly what you need to pay (stuff like rent, bills, and necessities), and how much you have left to spend on other things.
When you’ve identified your monthly expenses, you can then have a better idea of how to manage your finances, and ideally be able to save a significant amount for emergencies, expensive purchases, or investments.
LOOK FOR EXPENSES YOU CAN GIVE UP
How much do you spend on frivolous expenses? If you drink milk tea every day of the week, calculate how much it costs you. You might be surprised how a seemingly cheap or affordable splurge can rack up a high amount when added up.
This is not to say that you shouldn’t spend on self-care, or that you shouldn’t treat yourself from time to time. However, moderation is key; if a fast food chain burger everyday costs more than a home-cooked dish with some rice, you may be better off changing your lunch option and opting for the burger a few times a week instead. Similarly, if you’re paying a lot for several streaming services, you could instead pay for the one you use the most and put what you would’ve paid for other services into an internet savings account or an e-wallet.
Essentially, take a good look at your spending habits. Do you really need a new shirt, or are you only buying one because it’s on sale? When it comes to shopping, many items can be bought at any time – you may even find a better deal if you wait a little longer and save up for it.
WRAPPING IT UP
When it comes to savings, the most important thing is to get started. Whether you’re saving 5 pesos or 500 pesos, or even 5,000 pesos, it will add up eventually, and you’ll be surprised at how much you’ll have saved by the end of the month or the year.
And that’s it for today! Stay tuned for more investment and savings tips!
No Comments